The Keynesian economic model is based on many deceptions of logic and reality. The one deception which I used continually (1971 – 2000) when arranging commercial loans for my developer friends was the deception called: The Present Worth of Future Benefits (also called the Discounted Cash Flow Model). This deception is still used today as developers arrange for their huge financing packages with today’s bankers/lenders. Let’s explore this financial deception of the Keynesian economic model to gain understanding? Why did this deception work in the past and why will it NOT work in the present (going forward). Let’s review and think about the logic and reality of this Keynesian deception (which started back in the 70’s).
Mythical ‘Values’ are created via discounting imaginary future cash flows! This Keynesian model started back in the early 1970’s (after the closing of the gold window)! It’s a model which assumes that which which is ‘impossible’ in realtime! Who can actually know the FUTURE?
The ‘Present Worth of Future Benefits’ is a concept of Keynesian logic which assumes that I can discount future cash flows (say 10 years into the future) into a PRESENT ‘value’ via the logic of math and numbers. This deception is based on the idea that my ‘present’ perceptions of bottom line cash flows (along with future projections of inflation and cash flow growth) can be ‘discounted’ into a ‘present value’ with formulae of compound interest (over periods of time). This logic creates a mythical ‘value’ for a real estate project (or any series of cash flows over various time periods). This logic can then be manipulated to create practically any ‘present value’ which I desire (within reason)…and can sell to gullible banker/lenders who buy into this mythical Keynesian concept. Let’s think further about this concept of logic and imagination!
Reality is always a NOW experience, yet Keynesians like to create models of imagination which work only while inflation and Central Planning continue. Keynesians generally assume that historical business cycles can be eliminated by their Central Planning Models and their realtime manipulations/policies!
If I prepare a Discounted Cash Flow report for a banker/lender on a 300 unit apartment project (for example), I can create a mythical present ‘value’ which lenders might ‘bite’ on and then finance with their bank funds. I was quite good at this logic back in the 70’s and 80’s (when I was active in the real estate markets). This same logic is used today by brokers, investors, speculators, appraisers, and lenders to finance practically any asset which has the logic of continual cash flows over time. So what is the problem with this logic of Keynesianism? Why does it not work today and why was it mostly mythetical…since its inception back in the early 70’s? Most commercial real estate loans are based on this futuristic concept of imagination/myth.
Futuristic cash flows via a professional looking report makes reality ‘appear’ logical (even though the futuristic projections are proven wrong shortly after the loan is funded)!
First of all, this model of deriving a ‘Present Value’ generally assumes that cash flows will increase over time via inflation and growth. Without the reality of Keynesian inflation, however, this model would never have been developed. Inflation and continuing inflation creates this illusion that cash flows continually increase over futuristic time periods. And increasing cash flows (and inflation) mean that I can project (assume) a higher ‘Present Value’ for an asset than is generally justified based upon present moment reality (the now reality). I can create imaginary ‘values’ for my banker/lender friends so they can tell their Loan Committee that their proposed loan is Sound and Logical. All this logic, however, is mostly a huge MYTH! Why? Let’s explore further!
The reason this logic is a myth is because no one can actually determine future cash flows with any degree of accuracy. The entire concept of a ‘future’ which supposedly can be discerned precisely is a huge myth and is logically…unsound. We all live in the present moment continually. In reality, there is NO future which we can discern precisely and there is NO past which we can recall precisely. In reality, I/you live our lives (bodily/mentally) in the NOW MOMENT (always). The ‘now moment’ is reality and ONLY the ‘now moment’ is available for discerning realtime reality. Future cash flows are a huge imaginary projection of logic with no foundation within realtime reality. And these futuristic projections are nearly 100% wrong within a few months (sometimes days) after the bankers loan is funded. Within a year they are pure MYTH and totally worthless! Who can predict the future in our dynamic world of change? Answer: No One!
Personally, I can’t think of ONE valuation report which I prepared for my banker/lenders (based on the Discounted Cash Flow Model) which turned out valid or correct (and I did hundreds)…and most were wildly wrong within a years time. Yet the Keynesian logic allows for these futuristic projections (of cash flows) into a mythical future and allows lenders to ‘assume’ that these projections are based on sound realities and sound assumptions. Any projection of ‘inflation’ going forward, however, is a pure imaginary projection. Any projection of solid and growing cash flows into the future are also pure imaginary projections. And to make a proposed loan viable, appraisers were instructed to use these mythical projections for their reports (and lenders would buy into this logic)!
Most real estate developers assume that their projects will follow a cash flow path as above (increasing over futuristic time periods). This logic deceives most lenders into funding a loan which probably should not have been funded!
In reality, however, we all live in the present moment as we live our lives (what I call successive moments of now) and none of us can discern ‘tomorrow’ and/or the meaning of ‘yesterday’. So why do Keynesians desire to perpetuate this myth called the Present Worth of Future Benefits? My sense is that Keynesians (being Central Planners) assume that they can force the Free Market to perform precisely as they plan and determine (via their econometric formulae and models). They also assume ‘inflation’ (to some degree) forever! Those who buy into this Keynesian non-sense think that their logic is sound and that whatever projections (into the future) which they make are reasonable/sound and will likely develop (even though these projections are usually proven wrong within months or less)!
Keynesians (bankers/lenders/investors/ etc.) also assume (generally) a continuing inflation over time and this projected inflation (they assume) should ‘bail-out’ any false financial assumptions devised by this Discounted Cash Flow Model. Today, lenders continue this non-sense of projecting increasing cash flows over time and increasing or stable inflation over time (assuming that they can eliminate realtime market cycles). This is being done for all the new real estate development here in the Tucson/Phoenix area…resulting in substantial construction but with huge vacancies and unsold properties within each development. What non-sense…yet this allows developers to obtain large loans for their proposed development under the assumption that the FUTURE will be different (better) than realtime (now) reality!
Many housing developments in the Tucson/Phoenix areas are completed but not fully rented and/or sold. Lenders fund these projects via the Present Worth of Future Benefits model! This model does not work during a time of general Deflation!
As I drive into many new real estate developments in the Tucson/Phoenix area I have noticed that all developments have mostly spec homes/apartments which are now for-sale or for-rent. Many of these developments have from 70-85% vacant rental units and/or unsold homes. Lenders have obviously funded all these developments under the assumptions of this Keynesian model of: The Present Worth of Future Benefits (also called The Discounted Cash Flow Model). Now that DEFLATION is emerging in the Tucson/Phoenix markets and many other real estate markets, this mythical model developed by Keynesians (back in the 70’s) will fail miserably going forward. First time renters/buyers are not available in sufficient quantity to absorb all these apartments/houses at current prices.
I witness many huge real estate developments (fully funded by lenders) yet demand (at current prices) is not present. The DCF model is part of the problem (especially if Deflation is now emerging nationally and inter-nationally)! Lenders could be in serious trouble within the next 12 months (or less)!
Deflation is an ‘assumption’ which Keynesians do not accept as a reality! Deflation creates a situation where futuristic projections are mostly meaningless as ‘values’ are destroyed and all the mythical financial projections are so uncertain that lenders dare not accept this concept called: The Present Worth of Future Benefits. As ‘values’ get destroyed lenders become aware that all their past financial reports are worthless and meaningless. Liquidations create a new reality which Keynesians can not accept. Their Model is not built for Deflation and all Keynesians understand this reality. Let’s watch the markets for the coming Deflationary cycle which has now started locally, nationally, and inter-nationally (to variant degrees). Watch! I am: http://kingdomecon.wordpress.com
Much of the Euro-zone is now in deflation and/or a serious slow down. Italy, Portugal, Spain, Greece are now experiencing deflation with Germany, Britain, Sweden, and France slowing down as demand wanes. The entire European community of 28 states is now experiencing a drop in consumer demand and this means more deflation ahead. We witness some growth in the USA but this growth is ephemeral and may soon wane. Here in Tucson, Arizona, real estate building is strong but the demand for all the housing being built has not materialized.
Historical ‘inflation’ is now giving way to realtime ‘deflation’. This trend is unlikely to change going forward! Watch for more signs of a slow-down with more deflation ahead!
I personally drive into many subdivisions in the Tucson area and find substantial building of new homes and apartments. Yet I also notice that most of these new developments are mostly vacant. Builders are building on speculation…hoping that consumers will demand their new product. What is happening, however, is a glut of new homes and apartments are coming on the market with very weak demand. Some developments have over 80% vacant units (few buyers at current prices). How can this be viewed as a healthy economy going forward? At some point prices must decline further if all these new developments are to sell out. We need more deflation for this new glut of houses to be absorbed.
Greece, Italy, Spain, Sweden, Portugal, now in deflation. The trend is likely to continue for most Western countries going forward.
If other American cities are similar to the greater Tucson area (which is very likely), then we have a serious problem getting all these new units absorbed into the market. Prices will need to decline further and financing will need to remain favorable if this glut of properties are to be absorbed. The last couple of years, I have witnessed a strong demand from cash buyers (mostly corporate buyers) who bought up homes and apartments in the Tucson and Phoenix areas. This corporate demand fueled an increase in prices and values for 2011-2014. Cash buyers are now disappearing as home values are now starting to decline again. What does this portend for the future?
More evidence that ‘inflation’ is not our enemy going forward!
Real estate is likely to start another deflationary cycle in 2015 and this cycle could create the next serious recession/depression. Consumer income has not increased in the past few years and this means less demand and more vacancies. All the past QE helped the asset markets inflate somewhat but now with QE waning and soon being eliminated, we could witness the next serious recession/depression around the corner. Will our Fed attempt to reverse direction and start another QE program later this year? Personally, I don’t think so! This means that we will soon experience a serious slow-down in our economy along with the European economy (which is currently in serious trouble). Watch the stock and bond markets for signs that another downward cycle has started.
When I look at the geo-political situation globally, I also realize that all global markets are now getting stretched. Consumer demand appears to be slowing globally as well as in Europe and America. China is slowing. Russia is slowing. The Middle East countries are in a near-death spiral. The Asian tigers are slowing. Africa is slowing and Latin America is slowing. It appears, to me, that we are very near another downward business cycle. All the proposed QE for the European countries can not solve the DEMAND issue. Consumers make up most demand in all countries and with wages and income being stretched, I don’t envision any solution to this demand issue.
Central Bankers have a real ‘fear’ of Deflation as it reveals that their economic model is flawed! Every Central Banker will likely attempt to avoid any serious deflation going forward! But can these Centralized policymakers overcome the trend of the markets?
Some pundits are now recommending that our Central Banks initiate QE for the public. Some are saying that consumers need new spending power and that this spending power needs to come from QE (free digital cash) for all working taxpayers. Just send every taxpayer a direct digital deposit so they can use these funds to support the economy with new spending. This idea is feasible as all our so-called money today is mostly cyber money. Digital units can be created by our Fed (in whatever amounts desired) and then a direct transfer (a digital deposit) can be initiated by the Fed to each taxpayers banking account. This would be similar to what the Treasury is now doing for Social Security recipients. A direct deposit from computer to computer.
Our Treasury (via our Fed) could initiate a QE policy for the public. This could be accomplished via a direct deposit from the Fed’s computer to each taxpayers computer account! Would this type of counterfeiting work?
Ben Bernanke started this concept of QE for his select elite clients (the TBTF banks and primary dealers) in 2009. This concept of counterfeiting worked (to a degree) for the past 5 years. Will this concept be expanded so that all taxpayer consumers receive some new QE dollars? Why not? The entire financial system is now mostly within cyberspace and our digital dollar is created merely by typing new numbers into the computer screen. Why not create a few additional $trillion and use these units for a direct deposit for taxpaying consumers? The idea is unsound but so what! All monetary policy is now unsound and fraudulent anyway. So why not temporarily help the common taxpayer who needs funds for new spending? This idea is now in the open for our Fed to consider!
A direct deposit of counterfeit QE dollars could stall deflation for a short period! Our Fed (via our Treasury Department) could set up this policy so that every American taxpayer receives (say $10,000 via a direct deposit) from a QE policy to induce more inflation into our economy!
The coming deflationary trend started back in 2009 and was temporarily stalled while $trillions of new counterfeit QE dollars were created for our markets. This trend appears to be over in Europe and in America for the time being. So expect more DEFLATION going forward. Some 70% of demand derives from consumers and this demand has now been stretched to an extreme. Unless the Central Banks start a QE policy for the public, I don’t think the markets can do more than decline going forward. All the global markets are now stretched beyond a reasonable range. Get ready for some serious DEFLATION going forward, probably starting in Europe, then China, then Russia, and eventually America in 2015. Enjoy! I am: http://kingdomecon.wordpress.com
Jamie Dimon, Chairman of J.P. Morgan, says his bank is spending $250 million annually (including 1000 employees) to create cyber security for his banking firm. This was reported in the WSJ today. All our banks are now operating within cyberspace and practically all our currencies are now cyber currencies (pixels within our computer screens). We live in a new world of cybernomics. Who is aware of these changes in our economic system? Our ‘dollar’ is now a cyber currency and most currencies traded in realtime daily are now cyber currencies. Take a look at our digital electronic Stock Markets for evidence. We no longer operate under traditional Capitalism where our money was a physical item (a paper note or a metal coin) which we could hold in our hand. So what is a cyber currency? Let’s explore!
Some 96% of currency transactions are now within Cyberspace. Cybernomics is our New Global Economic System. Who is Aware?
A cyber currency is created by our Federal Reserve banking system via our electronic computer technology. Today, our Fed does not need to ‘print’ paper notes for our currency but it now merely ‘types’ into cyberspace digital numbers which then become our legal tender currency. Once these digital numbers enter the cyber account within the Fed’s computer (called the System Open Market Account), this creates new legal tender dollars for the Fed to use for their Asset Purchases. Our commercial banks do similar when they ‘type’ a new loan into their cyber account via our ‘fractional reserve’ banking methodology. New loans are now mostly created (many without any reserve requirement) and digital numbers get inputed into the computer screen representing both an Asset and a Liability (bookkeeping wise). We can call this ‘money from heaven’ (as these new digital numbers) have no physical location within our material universe. Who is aware of what is now happening within our banking establishment? Who understands the nature of ‘cyberspace’?
Let’s briefly define ‘cyberspace’ so we can discern the nature of this imaginary space which we all now use for our spending, purchasing, investing, and borrowing.
Cyberspace: A metaphor for describing the non-physical terrain created by computer systems. Online systems, for example, create a cyberspace within which people can communicate with one another (via e-mail), do research, trade currencies, shop, borrow, invest, or simply window shop. Like physical space, cyberspace contains objects (files, mail messages, graphics, etc.) and different modes of transportation and delivery. Unlike real space, though, exploring cyberspace does not require any physical movement other than pressing keys on a keyboard or moving a mouse.
Reread the above definition again to discern the ‘nature’ of this new non-physical (metaphysical) space which has become ubiquitous globally. This space is created by our computers and our digital information which enters our computers. We ‘type’ this information into our computer screen and it emerges as a display (set of images/text) which we can assume is real and physical. But is this metaphysical space ‘real’ (material/physical/out there). Historically, we have used the word ‘real’ as a word to denote that which ‘exists’ within our Material Universe (that which we observe when we walk outside within Nature). Trees are real. Houses are real. Cars are real, etc. But what are these displays that we observe within our computer screens?
Cyberspace derives from our ‘consciousness’ and enters the computer screen as digital units of information. These units are not Wealth and not Material! Think!
If you look at your computer screen (right now) you will observe the text which I am writing. Where does this digital text derive from? Does it not derive from my ‘consciousness’? Am I not now ‘thinking’ up these words which I am ‘typing’ into cyberspace? This same process is what our Fed now does when select administrators create our legal tender cyber currency (called our dollar). Our Fed (via their computer at the New York Federal Reserve building) ‘types’ into this System Computer digital numbers to increase their own cyber account (called the SOMA). Once new digital numbers (representing our cyber dollars) are inputed into their cyber account, they have magical ‘money’ for their Asset purchases and/or to manipulate the greater financial markets. What a magical operation which has emerged since our markets became electronic and computer driven. Do you discern how our so-called ‘money’ is now created/destroyed? Is this a long-term viable system?
Today, our Fed sits around a table and votes for QE and Computer manipulations to effect their economic policies. All these operations (computer driven) are subjective and examples of why we no longer have Capitalism in America. Cybernomics is what we live with today!
Today, we no longer live under traditional Capitalism (where our money could be held in your hand) but we live in a New World of Cybernomics. Our so-called ‘money’ is created as a digital unit which gets displayed within our computer screens as pixels of light (derived from pulses of light transmitted via speed of light fiber optic transmission cables). All this has happened in just the past 15 or so years and the entire planet has now been covered with underwater/underground fiber optic transmission lines (which send signals from computer to computer at near the speed of light). Why is cyber security the Big Issue within all our banking establishments today? Why is Jamie Dimon spending some $250 million annually merely to fight cyber invaders (malware, etc.) who desire to invade his computer systems? Can this type of monetary system (cybernomics) work for economics globally? Can it work for our longer-term National interests? Why? Why not?
The reason, I maintain, that this cyber currency system can not work is because it is totally SUBJECTIVE at the core. The cyber units which are created by our banking entities are ‘subjective’ units of nothing…created from nothing. The real purpose of any money system is to reflect a ‘value’ for ‘value’ transaction within the greater marketplace. All money is (at the core) a proxy/substitute for the concept which we call VALUE in exchange. What is the ‘present value’ of a future stream of digital units created ‘out of nothing’? Does ‘nothing’ represent ‘something’? Isn’t money (under Capitalism) suppose to represent some THING (unit of wealth) created for our physical markets? Think about today’s units which we call ‘money’. What are they? Where are they? What are units within Cyberspace (in reality)? Can we call these units forms of physical WEALTH?
The above image is an example of ‘material’ wealth. Food is the foundation of what economics is all about. Digital numbers in our computer screens can not be consumed for sustenance! We need to recognize that Cybernomics is not the same as historical Capitalism!
What we need to understand is that Wealth is the primary Goal of Economics. The purpose of Economics is to create new growing Wealth for a society (today our entire planet). Wealth is not these digital cyber units within our computer screens (our IRA’s, Mutual Funds, Savings Accounts, 401K accounts, etc.). Wealth includes farm products, manufactured products, houses, cars, physical buildings, airplanes, machinery, apparel, health products, and other material items. Wealth includes all the ‘stuff’ in your house, garage, storage shed, and that which we see outside our consciousness. Wealth derives from our Natural Resources (not from typing digital numbers into computer screens at the Fed and all the other Central Banks on this planet). Think about the PURPOSE of economics!
Central Bankers create subjective digital numbers and call these numbers Legal Tender! This is not Capitalism. This should be called CyberNomics or DigiNomics! What do you think?
In closing, we need to recognize that today’s global Cybernomic economy is a failed economy. Our stock markets go up, up, up (via all the digital electronic manipulations) but our real physical wealth, our infrastructure, our global material markets, our International poverty levels, are declining (relatively). Money from heaven (via typing digital numbers into computer screens) is not a viable long-term economic system for this planet. Cyber currencies are totally SUBJECTIVE and without any measuring ability (over longer time periods). Today, our deficits are decreasing (relative to a prior period) yet our overall DEBT and sustainability is getting much more dire. What goes up, up, up today are manipulated stock/bond markets and not any real observable WEALTH. It’s time to wake-up and smell the oder. Think anew! I am: http://kingdomecon.wordpress.com
Today, we have some 41,000 Christian denominations, thousands of Islamic sects, hundreds of Jewish sects, in addition to Buddhist sects, Hindu sects, Atheists, and the countless individuals who call themselves scientists. All claim that ‘Truth’ is part of their goal. Everyone within the hierarchy of each sect/organization assumes that they can discover final (absolute) Truth (if not now, then eventually). Is any of this realistic and reasonable in today’s age of relativity? We now have some 7 billion people on our planet (each with a subjective/relative perspective on reality). Can any single person or group of persons discover final/absolute Truth for everyone? Would it not be more realistic to admit that all ‘Truth’ is relative to the individual (subjective) and impossible to enunciate in some final/absolute form?
Most people tend to ‘follow’ a leader who claims that he/she has absolute truth to present! Is this reality or mere deception?
Today, we can witness millions of perspectives on the internet. Each perspective seems limited and uncertain about what they present and believe. Some people believe in a Higher Intelligence (say God) and others believe in a ‘here and now’ reality of secularism or existentialism. When I listen to our World Leaders via the media or the internet, I discern that each leader has a different perspective on what is happening and what should happen. Politicians to not agree on most serious issues of legislation and educators have all sorts of different perspectives on practically every issue of life. So WHO can discern final or absolute reality? Doesn’t it seem realistic that no-one can? Doesn’t it seem realistic that we all have limited/subjective perspectives? What do you think?
Do we actually experience a Past or a Future? Is not reality lived ALWAYS in the now! Who actually experiences a ‘past’ or a ‘future’? Personally, I live my life as ‘successive moments of now’ (always)! My ‘past’ is always a NOW memory!
Wouldn’t our world be more realistic and practical if everyone adopted the view that human beings are limited/subjective/uncertain/and unable to achieve the lofty/impossible goal of playing God (for everyone)? Who is this all-knowing (omniscient) person who can enunciate final/absolute reality for the entire human race (all 7 billion people)? Has anyone met a person who fits this description on planet Earth? What I witness in realtime are subjective human beings (leaders and non-leaders) who seem quite limited and uncertain about what reality is all about! If we assume that select human intellectuals could achieve the status of enunciating absolute Truth, then who might this be? Is their anyone from history and/or from current realtime experience who might be this all-knowing (super presenter of final/absolute Truth)? Let’s review a couple of possibilities to discern if this is myth or reality.
Can ‘anyone’ interpret WORDS in a Holy Book and by-pass their subjective/limited perspective? Who can enunciate the Mind of the Creator/Logos/Most High via ‘words’ and personal ‘interpretations’?
Can ‘words’ from the holy books (Torah, Quran, Vedas, Bible, Book of Mormon, etc.) lead to absolute Truth? This idea can be immediately dismissed as every reader of these books presents unique ‘interpretations’ from the words which are read. If each reader of a Holy Book has a subjective interpretation, then it is obvious that ‘words’ can not lead to absolute/final Truth. Realtime experience reveals that we have millions of different interpretations of each human experience and the history of human experience. Those who believe in a ‘here and now’ reality (Worldview) tend to interpret events differently from those who believe in a ‘Past’/’Future’ interpretation of events. This shows that every serious thinker has their own unique Worldview. This means that all interpretations of events are less than Absolute/Final.
Can any single individual or group enunciate/interpret/devise that which is Absolute/Final/Truth for the entire planet of persons (now some 7 billion)? Is there any person on our planet today who can play God (and be viewed as a Final/Absolute Authority) for EVERYONE? Who? If not, then what does this imply?
Let’s end with this conclusion. Human beings are all uncertain (to various degrees) about reality and incapable of enunciating any FINAL TRUTH about history, current events, or potential events. Our ‘words’ and ‘rhetoric’ reveals our subjective mindset and uncertain perspective. Science can not tell any Absolute Truth. Religion can not tell any Absolute Truth. Educators can not tell any Absolute Truth. Philosophers can not tell any Absolute Truth. Not one person on this planet can enunciate or document any Final/Absolute/Unchanging TRUTH. All Holy Books must be interpreted by the reader and this reveals the readers SUBJECTIVE thinking/interpretations. What we witness in realtime on this planet is a RELATIVE marketplace of ideas and interpretations. Reality is therefore RELATIVE. This does not mean that one can not SEEK absolute Truth! I can SEEK daily that which is ‘true’ and ‘absolute’…but this SEEKING is a continuing process (and unending process) in our realtime world! What do you think? I am: http://kingdomecon.wordpress.com
If we view reality from the perspective of the whole (our planet) we might conclude that all reality is ‘subjective’ at the core. Why? In reality, I am a subjective person as my words, observations, and ideas derive from my subjective thinking (which is personal and limited). You, I maintain, also have a subjective perspective or viewpoint. We, as human beings, are unable to discern ultimate reality or that which is absolute for everyone. This suggests that all reality is ultimately ‘subjective’ and relative. How do I discern my subjective reality? What I do is derive assumptions about what I observe and what I desire to present to you. My assumptions are always tentative and uncertain to some degree. So, ultimately, all reality is ‘subjective’ to some degree. Let’s now talk about what most of us view as that which is relatively ‘objective’. If I propose that an element from the earth has substance and can be minted into a coin for exchange as ‘money’, would this be a reasonable assumption? In other words, if I proposed that a gold coin (say with one ounce of pure AU within the coin) can be minted and then used as ‘money’ for our marketplace, would this seem like a reasonable proposal for getting a financial market off the ground? Most of us probably would agree that this proposal is logical and reasonable. This suggests that reality starts out as subjective assumptions (personal and uncertain) and after we agree on select assumptions we can assert that our agreement represents a logical and objective viewpoint. If a large group of diverse thinkers also agree, then we can assert that this is an objective conclusion. Does this sound reasonable? We start with subjective concepts, assumptions, and observations (derived from personal experience) and then we create that which is objective (via later agreements)? Agreement (by a group of thinkers) is what creates new realities which we then call objective and/or facts!
The human ‘eye’ observes reality but all observations start out as a subjective assumptions (based on someone’s personal perspective/viewpoint)! Later we tend to agree on that which is obvious and this creates a form of ‘objectivity’! Our goal when creating a monetary system is to promote that which is mostly ‘objective’ for the whole! Doesn’t this sound reasonable?
Our planet currently has around 7 billion human beings occupying space on the planet. America has about 315 million people occupying space. Does any single individual person have absolute knowledge, understanding, discernment, and abilities to enunciate ‘objective’ reality for everyone (or for the planet as a whole)? Are not all individuals (persons) limited, uncertain, and subjective with their viewpoints and perspective (within various degrees)? Is there any single person who can claim to be all-knowing and the source for all that we call reality? I don’t think there is anyone (on our planet)! What do you think?
We would generally agree that ‘things’ which can be identified from nature and created so that everyone can use these ‘things’ in the same manner with the same meaning would reflect a degree of objectivity. For example: If I desire to exchange a dozen eggs for your loaf of bread and you agree with this exchange, then we could say that this was an ‘objective’ agreement (at least between you and me). My point is that the word ‘objective’ is merely an agreement that we both reach from thinking about what we are saying and doing (and then agreeing). Human beings decide via agreements that which is objective within their Worldview. Now let’s talk about economics and money to expand these concepts of objectivity and logic. In reality, there is no such ‘thing’ as money within our greater material universe (right now/at this moment). Would you agree? Yet, we can certainly ‘invent’ some ‘thing’ as money if we desire. Doesn’t this sound logical. As human beings we ‘invent’ reality continually (isn’t our current cyber/digital currency a recent invention). For example: Let’s start with a barter marketplace (where a group of people are desiring to exchange their products for other products produced by various counterparties). What concept emerges as we start this process of exchange within our marketplace? What concept (within our subjective mind/consciousness) emerges as we think about this exchange of products? Do we not desire a ‘value’ for ‘value’ exchange? Think about what is important when we exchange products (which we own/produced) within a barter marketplace! Doesn’t the concept of ‘value’ emerge from our thinking?
People start a marketplace and negotiate subjectively. Later these negotiations become transparent and ‘prices’ emerge! Monetary transactions create our ‘prices’! Prices are determined by agreements between participants within a marketplace. We usually call this process objective when full transparency is available for each participant. The core underlying concept of trading is the concept we call ‘value’!
I would suggest that the concept which emerges when we exchange products is the concept we call ‘value’. When we exchange product for product (assuming we both produced these products with our labor and intellect), we encounter this subjective concept called ‘value’ and/or ‘value in exchange’. What is the ‘value’ of my eggs and your loaf of bread prior to an exchange? Is the concept of ‘value’ a subjective concept? Do we not have different perceptions/conceptions of ‘value’ within our personal thinking? Let’s assume that we make an exchange. Is this a relatively ‘equal’ exchange? Is it a ‘fair’ exchange? Is this exchange a ‘value’ for ‘value’ exchange? Let’s say that we make the exchange and that others in our marketplace agree that our exchange was ‘fair’ and ‘equitable’. Does this not make the exchange somewhat ‘objective’? I think most of us would agree that this exchange of 12 eggs for a specific loaf of home-made bread was probably an ‘objective’ exchange (upon reflection). This example, my friends, is the foundation of economics and an emerging ‘money’ system. Value was given for Value and we now desire to expand this process/operation so that our marketplace can expand, grow, and prosper. What happens over time? What emerges from our marketplace? What do we create as a proxy or substitute for this subjective concept that we call ‘value’?
This scale represents the concept of giving and receiving (value for value)! Prior to selecting (inventing) our money item and our currency concept we must ‘barter’ our subjective perceptions of ‘value’ to arrive at some agreement. This subjective negotiation process eventually leads to the creation of a money/currency system!
As we continue with various exchanges of products (via our subjective bartering), we desire to find some item within our marketplace which can be viewed as an ‘objective’ substitute for this subjective concept that we call ‘value’. What could we invent that could be accepted by our marketplace as a proxy/substitute for the subjective concept called ‘value’? After much trial and error, let’s assume that we all agree that the element called AU (gold) minted into a coin of one ounce pure gold, would be a relatively ‘objective’ standard of ‘value’ for all exchanges within our marketplace. This market behavior then sets in motion this gold coin as our initial ‘money’ item for additional exchanges within our marketplace. We have now ‘invented’ money to serve as our proxy/substitute for this subjective concept we call ‘value’. A gold coin (one ounce) becomes both our ‘money’ and our ‘currency’ (think about this process which started from barter). Now let’s expand our marketplace further and add the concept of ‘calculating’ value via our invention! If we use this gold coin for new exchanges within our marketplace, we can create the concept of ‘prices’ for each product. Creating objective ‘prices’ is accomplished when we have some objective currency (for our valuation process)! Let’s explore!
A one ounce gold coin is ‘invented’ to serve as our proxy or substitute for the subjective concept called Value! Later we specify (via a definition) the number of grains within the gold coin that will equal our initial currency unit. We could start with 24.75 grains of pure gold equaling a currency unit (say our dollar). The word ‘dollar’ now is defined and equal to 24.75 grains of Au. This starts our valuation system for our financial markets. Can you discern the importance of this starting process for determining stable ‘prices’ within our marketplace?
As time continues and we exchange products for products, we discover that specific ‘prices’ emerge within our marketplace from our diverse transactions using these gold coins. One dozen eggs = 1 Au coin. One loaf of bread = 1 Au coin, etc. As exchanges are made and more transactions develop, new ‘prices’ (denominated in Au coins) emerge within our marketplace. Over time, these ‘prices’ (and other product prices) become the measure of ‘value’ for all our products being exchanged. This eventually emerges into a greater marketplace which we can now call Capitalism. Capitalism has emerged from our exchanges of products for products and we now can expand this System of Capitalism to the entire global marketplace. Our logic is sound and most market participants like gold as our invented ‘money’. Exchanges (using a currency/dollar) can now be accomplished with a medium of exchange (our Au coin)…now a standard of value, and a store of value (as well as a unit of accounting). All this happened via our subjective thinking which we later called ‘objective’ as agreements and prices emerged fairly and logically within the greater marketplace. Isn’t this how our markets started? Didn’t our markets emerge from our subjective thinking and then evolve via agreements which we viewed as logical, fair, and relatively ‘objective’? Think about the above First Principles! First Principles are the key to understanding today’s confused markets!
As we trade products produced from the soil (via our defined currency unit) ‘prices’ emerge. Prices gradually get objectified (and remembered) as trades are made within a marketplace! Prices are mostly stable when our currency unit is defined and exchangeable into some physical ‘thing’ which the marketplace perceives as containing ‘value’. Without this definition of a currency unit, stable prices are impossible! For prices to remain somewhat stable over time requires a disciplined financial system (administered by knowledgeable and discerning administrators)!
Now let’s ‘fast forward’ this logic and thinking which we can call First Principles do our realtime markets today. Do we have any ‘objective’ or stable markets today? Are exchanges of ‘value’ between counterparties in our marketplace reflecting ‘objective’ exchanges of value? Let’s start with this example: China produces products for America which we display within our stores (let’s use Wal-mart as our example). All these products are produced by Chinese workers and Chinese intellect for our stores. Americans desire these products and our consumers purchase these products with a type of ‘money’ called the American Dollar (now a cyberspace unit). We purchase these Chinese products and then exchange our American Cyber Dollars for these products. Is our Chinese counterparty receiving fair ‘value’, equivalent to what they provide us, via this exchange? Let’s think about what China is providing us and what we are giving them in exchange. Do we have a ‘value’ for ‘value’ exchange? Is this exchange really a ‘fair’ exchange for both parties to the transaction? China is providing us material products/wealth (produced from their soil and via their intellect) and we provide them with a cyber currency (which is created out of thin-air by our Central Bank). This unit within cyberspace has no real inherent value/wealth. We create this unit via our mental activity (also called our consciousness). Where is the comparable labor and materiality on the American side for these transactions? Is a ‘no-thing’ unit within cyberspace = to a material product produced from the soil of china (also called real material wealth)? Let’s think about this process of exchange between China and America. We receive ‘value’ (a material product) and we give ‘nothing’ (a typed into the computer cyber unit). Cyber units do not even ‘exist’ within observable time and space. How can this be viewed (objectively) as a ‘value’ for ‘value’ exchange? Do you discern this Ponzi exchange process between China and America? China now has some $3 trillion of our cyber dollars within their computer screen (Central Bank). How does America create their cyber dollar? Do you know?
Today, our prices emerge from computer manipulations and via centralized decisions within our private banks (commercial as well as our Central Bank)! There is no Free Market Capitalism to set transparent prices for our products (nationally or internationally)! All is now mostly within Cyberspace (a subjective space within our extended consciousness)! We trade ‘imaginary’ currencies and ‘imaginary’ values from our computer driven manipulations. We will soon have a global cashless computerized pricing mechanism (all within cyberspace). Objective prices are now not possible! Do you discern these realities?
If we go back to our starting example, our First Principles, we should be exchanging the ‘money’ which we invented for the products which China is providing for our markets. This ‘money emerged from the marketplace and everyone agreed that this unit of Au was a ‘thing’ of perceived ‘value’. We originally invented the element called AU/gold as our ‘money’. We then minted coins (let’s say one ounce coins) to serve as our proxy for value (our money) for all monetary transactions. What we are giving China today, however, is an American Dollar which does not even EXIST (as an objective thing). Can you discern what a cyber dollar is (in reality)? What is our American Dollar today? Do you understand? We receive millions of products from China every day and we give China a ‘non-thing’ (called the America Cyber Dollar). Where is this American Cyber Dollar within our greater material universe? Can you or our Chinese counterparty locate, find, or hold this American Cyber Dollar so it can be objectively identified? Think about the nature of this American Cyber Dollar. We create this cyber unit by merely ‘typing’ numbers into the computer screen. How can ‘numbers’ typed into the computer screen be viewed as ‘objective’ money/currency? These units get created by our Centralized Federal Reserve (by merely a few administrators meeting mostly in secret) without any objective logic (derived from market participants or via supply/demand). Our market does not create these cyber units (only the Fed can create these units). Does this sound like an objective marketplace or what we generally call Free Market Capitalism? Not in my mind! What do you think?
The American Cyber Dollar can not be found, located, or held in one’s hand. Cyber money has replaced ‘objective’ money (gold/silver/copper)! We now live with ‘subjective’ currencies globally (which have no referent to material reality)! These units are NOT objective ‘wealth’. This type of non-system eventually leads to serious distortions, value destruction, mal-investments, price volatility, inflation/deflation, and a general loss in confidence within our trading markets (nationally and internationally).
In conclusion, let’s summarize what we have considered above:
1. All reality is ‘subjective’ at the core. This is because each human being is unique and subjective (with limited knowledge/understanding). There is none on our planet who can discern reality objectively for everyone!
2. What we call ‘objective’ reality emerges from our agreements (and agreements change over time). We observe and think about reality and then ‘agreements’ develop. When a body of intellects agree on prior assumptions, we call this objective reality. Later this reality is discovered to be fallacious or illusionary!
3. Capitalism starts with private property (ownership) and then we exchange products within a marketplace. Exchange of products creates this subjective concept which we call ‘value’. Value is the core concept of Capitalism!
4. The concept we call ‘money’ starts out as a ‘word’ derived from someone’s subjective mouth. After most participants agree that a particular ‘thing’ has perceived ‘value’ (for all within a marketplace) we then agree that this invented ‘thing’ is our money. Money is the ‘name’ we give to that which our marketplace has chosen (invented) for our proxy for ‘value’.
5. As time continues we invent a ‘currency’ (like our dollar) which emerges from a definition/weight of the item we chose as our ‘money’. This ‘currency’ is used to calculate/measure value in the marketplace more precisely.
6. As we calculate ‘value’ of all the products within a marketplace, ‘prices’ emerge for all these products. Prices tend to remain stable and constant when our ‘money’ is sound and derived from nature (at least for a time period).
7. Today, we have abandoned the market logic (of our Free Market Capitalism) and created a Centralized Bureaucracy (called the Fed) to create subjective currencies for us and our foreign counterparties.
8. Our subjective Cyber Dollar is an example of a unit of nothing which creates unfair transactions for all our foreign counterparties (as well as our own National markets). Today, there is no real ‘value’ for ‘value’ exchanges and all is now ‘subjective’ globally. We now trade a subjective cyber dollar (in exchange for our imported products) with no real knowledge of what is the objective ‘value’ underlying the exchange. This creates distortions, mal-investments, volatility, and manipulated prices. Governments demand centralization and this leads to their planned Cashless Society (soon to arrive on a global basis)!
Give this missive some serious thought and think for yourself about what has evolved since the closing of the gold window in 1971. First Principles are key to understanding today’s markets. Do Americans desire a subjective currency system where a few elite bureaucrats administer all that occurs within our markets? This is what America now lives with! Who understands? Enjoy! I am: http://kingdomecon.wordpress.com
I am receiving many emails (responding to my prior missives) which lead me to the conclusion that many readers of my blog do not understand some basic principles of economics, money, history. I realize that economics and money are difficult subjects to fully understand. The voices within this profession are many and each voice tends to espouse a unique point-of-view. Maybe if I pose some questions and provide some new direct answers this will help with understanding. I hope the following questions and answers will help those seeking clarity and meaning:
1. What is the meaning of the concept which I call: ‘value’ for ‘value’? Answer: When Americans purchase goods from China we assume that these goods (let’s think of goods at Wal-mart) have a perceived ‘value’. This means that we should be providing China with an equivalent ‘value’ in terms of the currency which we give them (in exchange). China produces goods within their country and labor and intellect is ‘spent’ to produce these goods. So we assume that they desire payment in terms of something which is perceived as having equivalent ‘value’. This is economics 101. We receive ‘value’ and we then give equivalent ‘value’.
2. Is the American ‘dollar’ (now mostly a digital unit) a thing perceived to have ‘value’ (in the minds of foreigners)? Answer: A currency unit (like our cyber dollar) which is not defined in terms of some physical ‘thing’ (perceived to have ‘value’) is really NOTHING of substance (we can say that it is ‘valueless’). If I give you a currency symbol ($) and a number (1.00) for goods which you provide me (say items of food, clothing, technology, etc.) am I giving you some ‘thing’ of ‘value’? Is a symbol and a number (typed into the computer screen) and sent to your computer screen a ‘thing’ of ‘value’? I would say NO! A mere symbol/number is a mental abstraction (similar to an imaginary tooth fairy) and can not be viewed as a ‘thing’ of ‘value’. We need to focus directly on what is being exchanged for the products provided. Is the exchange a ‘value’ for ‘value’ exchange?
3. Is Gold (the metal/element derived from our earth) a ‘thing’ of ‘value’? Answer: Within economics and monetary history, the element that we call ‘gold’ has been chosen as money and has been perceived as being a ‘thing’ of ‘value’ (by most market participants). When we barter products in the marketplace, each party desires to exchange ‘value’ for ‘value’ when negotiating an exchange. Since ‘value’ is a subjective concept of our Mind, we invented a substitute (proxy) for this subjective concept called ‘value’. Gold was one commodity which served as an objective proxy for the subjective concept called ‘value’. Silver also was chosen (invented) as a proxy. For small transactions, copper was chosen. This means that gold (and silver) are elements which the marketplace has chosen as ‘things’ with a perceived ‘value’.
4. How did a ‘currency unit’ emerge from the greater marketplace? Answer: Within a barter marketplace people first choose some ‘thing’ (perceived to have ‘value’) as their money item (let’s say gold). Then to calculate or measure this subjective concept called ‘value’, we developed a ‘currency’ (a mental abstraction) which is ideal for ‘counting’ purposes. Americans developed the concept called ‘dollar’ as their currency unit. We then created the symbol ($) and the number (1.00) as a mathematical tool for our ‘valuations’ within the marketplace. To give this symbol/number ($1.00) meaning we DEFINED this mental abstraction in terms of the money item chosen (say gold/silver). For Americans we initially defined our ‘dollar’ (a mental abstraction) as 24.75 grains of the element called Gold and/or 371.25 grains of the element called silver. This gave our ‘dollar’ meaning and also perceived ‘value’. Can you discern how important this definition becomes when trading with foreigners?
5. Is the meaning of the word ‘money’ different from the word ‘currency’? Answer: Absolutely! The element called gold is initially chosen as our proxy for ‘value’. This is done within our greater barter marketplace. We then create the concept called a ‘currency’ to specify a specific weight or quantity of gold. This gives our currency (a mental abstraction) meaning (especially when we provide users of this currency the option of exchanging the currency unit, if desired, directly for the defined element…upon which the currency name is based). In other words, a currency unit like our ‘dollar’, takes on meaning when we can exchange this unit for either 24.75 grains of gold and/or 371.25 grains of silver (minted into a coin or coins). Without this definition and exchange option, the currency unit is merely a ‘mental abstraction’ (a valueless symbol/number/name). Think about our foreign counterparties who are supplying us our products at Wal-mart, etc.
6. Who took America off the gold standard…which had given our currency meaning and real ‘value’ for over 140 years? Answer: This was initially done in 1933-34 by Franklin D. Roosevelt. FDR called in all private gold bullion (owned by Americans) and then chose to force Americans to accept the Federal Reserve Notes (created by our centralized Federal Reserve Bank) as a substitute. This was done, with the hope that Americans would start spending and developing confidence in his New Deal policies. FDR felt that ownership of gold (for Americans) was not necessary to get our economy moving forward. FDR did, however, provide foreigners the option of converting their ‘dollars’ into our gold.
7. Who took America off the gold standard for our international exchanges of goods/services? Answer: This was done by Richard Milhous Nixon on August 15, 1971. RMN was advised by his Treasury Secretary and also by famed economist, Milton Friedman, that our gold supply (held at Fort Knox) was declining rapidly (due to foreign exchanges of our currency for gold)…based upon the agreements reached at the Bretton Woods Monetary Agreement of 1944-46. In 1944 America had some 740 million ounces of gold at Fort Knox, Kentucky. This supply was declining rapidly due do foreigners desiring to exchange their surplus ‘dollars’ for our gold (pursuant to this Bretton Woods Agreement). As of August 15, 1971, America’s gold supply (our ownership) had declined to some 272 million ounces (over 60% decline). A continuation of these exchanges of our paper currency for its backing (gold) would leave America with a currency of zero perceived ‘value’. Can you discern the problem?
8. How did America continue to create confidence in a ‘dollar’ which had no perceived ‘value’ after August 15, 1971? Answer: What happened is that our ‘dollar’ emerged as a valueless mental abstraction (after 1971) but Richard Milhous Nixon was able to convince Saudi Arabia (who controlled the global oil supply) to ‘price’ their oil in our ‘dollar’ and to force every foreign purchaser of this oil to convert their National currency into our American dollar prior to getting oil from Saudi Arabia (and later the OPEC cartel). Henry Kissinger, Secretary of State, was the negotiator for this dollar/oil cartel agreement. This agreement gave our fiat (valueless) dollar the illusion of having ‘value’ in the minds of foreigners. The rhetoric from American politicians was that our valueless fiat dollar was backed by oil (really a complete illusion but it never-the-less worked). A deceptive America forced the world community to buy into their mental abstraction currency (now called a fiat dollar which was technically ‘valueless’). Deception can work for a time period!
9. Why are foreigners now desiring to abandon our fiat (valueless) dollar which provided America with a favored status since 1971? Answer: Foreigners are now recognizing that America (4% of the world’s population) has been consuming some 20-30% of the world’s resources due to their favored status…provided by our illusionary dollar (also called the Reserve Currency for the World). This unfairness (weighted towards America and their consumers) is now being recognized as totally unbalanced for our globalized world where resources need to be shared more equitably. Why should America have this favored status…and control over the entire planet (economically) in this new interconnected world of cyber currencies and globalization? Also, energy (oil) is now changing ownership and foreigners would like oil and other key resources to be priced in alternative currencies (including gold) so that fairness is restored within the international currency exchange system. Do you blame them?
10. Will America give up its favored status and its favored claim on the planet’s resources going forward? Answer: Probably not without a military fight! America is now so spoiled (given their favored economic status for the past 43 years) that they may desire to use their Super Power Status to hold onto this favored (economic exceptionalism) status using their philosophy of MIGHT makes RIGHT (their military prowess) to bomb and kill all those who desire to change the System. Human Nature tends to be self-centered and prideful when it comes to changing habits which have seemed so special for so many years. Politicians, also have a hard time giving up privileges which they assume as a given for a Super Power Nation. Would you think differently?
The above questions may help readers of Kingdom Economics to understand how our system has evolved and changed since going off the gold standard in 1971. Will Americans desire to understand this history? Will Americans desire to give up their favored economic status going forward? These are the big questions which everyone needs to think about. My sense is that most Americans will desire a meaningful change once they fully understand this history and the unfairness of the current economic model of debt, deficits, and currencies which have become illusions of the mind. Think about the above questions and the answers which follow. Do you desire to create a New System? I am: http://kingdomecon.wordpress.com
Economic justice demands that ‘value’ be given for ‘value’. America has not done this since the closing of the Gold Window on August 15, 1971. America has traded for some $22 trillion of goods and services where ‘value’ was not given (add up our trade deficits since 1971). This injustice must now be realized and America must now give an equivalent return (in terms of labor and barter) to all our trading partners who have not received ‘value’ for ‘value’. In fact, America (if they desire to be fair) should give double back in terms of ‘value’ for all the wealth that we have unfairly taken from the world community (unjustly and deceptively). Justice demands that we do this! And we must do this (not in our ‘funny money’ dollar…now a cyber nothing) but in terms of real physical wealth and/or services which our counterparties accept. We can start with China as they have accumulated most of our ‘funny money’ and given us real physical wealth from the labor of their citizens. Go into Wal-Mart to witness all the products provided to American consumers by our Chinese friends!
Wal-mart stores are loaded with products from China. What is America giving in return? Do we give ‘value’ for ‘value’? Are you aware that we now create our trading dollar by ‘typing’ numbers into cyberspace?
In the very near future we need to think about our past economic/monetary behavior and recognize that we have not been just and fair with our counterparties. Funny money (our fiat paper units and our current cyber dollars) are not WEALTH. This unit of nothing can not qualify as a stable currency (as it is not backed by any real ‘value’). America now merely ‘types’ numbers into the computer screen and assumes that this ‘funny money’ can be used as an equivalent ‘value’ to what we receive in real physical products (goods) from foreigners. This is unjust and we should all recognize that America must now pay REPARATIONS (using real products and our physical labor) to the world community (especially China, Japan, Germany, South Korea, Saudi Arabia, and all those who have a trade surplus with America). This trade surplus is now measured with a ‘valueless’ cyber currency which will soon crash and burn. America has been the BANKER for the world as our currency is the RESERVE CURRENCY for most trade settlements.
Since abandoning the Gold Exchange Agreement in 1971, America has consumed much more than it has given to others! Our ‘funny money’ dollar has acted as our proxy for ‘value’…but what is a ‘dollar’ when it is perceived to be ‘valueless’?
America, if just and fair, must now think in terms of paying back all the WEALTH unfairly consumed from the labor and resources of our counterparties. The economic world works in terms of ‘value’ for ‘value’. This has been Capitalism from day one. The bottom line is our measure of ‘value’ for the ‘value’ from our counterparty. Money works as this proxy for ‘value’ when the currency unit is backed by some THING (perceived to have ‘value’). The THING which the world community has viewed as a THING of ‘value’ when a barter item was not exchanged is GOLD. America started with some 740 million ounces of GOLD (backing our dollar) in 1944-46. Today, all our GOLD is gone (sold, exchanged, or leased into the markets). We now trade with our ‘funny money’ dollar which we TYPE into cyberspace (our computers) and send via pulses of light to our counterparties. These accumulations of virtual ‘numbers can not be viewed as a THING of ‘value’. They are imaginary and NOTHING! Will America recognize this injustice? Will America deal with our counterparties fairly going forward? This is the ISSUE!
Economic JUSTICE now demands that America think in terms of paying ‘reparations’ to those who did not receive ‘value’ for ‘value’ since we abandoned the Gold Exchange Standard on August 15, 1971. Today’s cyber dollar payments (created by our Fed out-of-nothing) compounds the injustice for Americans when it comes to ‘value’ for ‘value’ exchanges with our foreign counterparties!
Anyone with any type of mathematical understanding recognizes that our current economic system is unsound and about to CRASH. The accumulation of DEBT has reached levels which can not be sustained or justified. All of America’s DEBT represents accumulations of WEALTH which has already been consumed. We can not repay our debtors with additional debt that has zero ‘value’ and expect that this is fair for our counterparties. Our military ‘might’ creates FEAR in the mind’s of many counterparties, but this philosophy of Might makes Right can not continue much longer. Deception, fear, and intimidation by American policymakers has reached its threshold level. Go look at our continuing TRADE DEFICITS since 1971 and think for yourself. Can this Ponzi scheme continue with no repercussions or consequences? I don’t think so! Get ready for some repayment (reparations) to those who deserve ‘value’ for ‘value’. I am: http://kingdomecon.wordpress.com